1. The petitioner, by filing this petition has prayed for issuance of writ of certiorari or any other appropriate writ, order or direction for quashing and setting aside show cause notices at Annexures 'N', 'D' and 'P'.

2. The petitioner, engaged in the manufacture of non-alcoholic beverage base, was subjected to the excise duty under heading 33.02 of Central Excise Tariff for a period from 1-3-1989 to November, 1993. The petitioner was paying excise duty for which there is no dispute. It is also clear that the duty paid was accepted by the Revenue. However, show cause notice was issued on 30-3-1994 calling upon the petitioner to pay the differential amount of central excise duty of Rs. 2,68,29,433.15 as basic excise duty and Rs. 18,61,396.53 as special excise duty totaling to Rs. 2,86,90,828.68 leviable on the clearance of non-alcoholic beverage base units during the period mentioned earlier under provisions contained in section 11a of the central excises & salt act, 1944. The petitioner was also called upon to pay the amount of Rs. 24,49,262.00 as basic excise duty being the differential amount of Central Excise Duty. The petitioner was also called upon to show cause as to why penalty under Rule 173Q(1) should not be imposed. From the text of the notices, it appears that the allegation was that the petitioner contravened the provisions of Rules 9(1), 173C, 173F, 173G and 226 of the Central Excise Rules, 1944 (herein after referred to as the Rules), the details of which are mentioned in paragraph 23 of the show cause notice (at page 49, running page 294) as under :-

23. It appears that M/s. Parle International Ltd., Ahmedabad have contravened the provisions of Rules 9(1), 173C, 173F, 173G and 226 of the "Said Rules" inasmuch as :-

(i) they have deliberately suppressed the correct assessable value and have removed the NABB units from their factories without payment of proper Central Excise Duty as required under rule 9(1) of the 'Said Rules';

(ii) they have deliberately shown lesser Assessable value in the Price List filed with the Department from time to time and have failed to declare the correct assessable value in the Price List as required under Rule 173C of the 'Said Rules';

(iii) they have failed to determine and pay correct Central Excise duty leviable on the NABB units before its removal as required under rule 173F of the 'Said Rules';

(iv) they have failed to show correct Assessable value and the duty paid on the NABB units in various statutory documents and returns filed with the department from time to time as required under Rule 173G of the 'Said Rule';

(v) they have failed to properly maintain statutory books of account and infact have maintained parallel private account for the sale of NABB units and have thus contravened the provisions of rule 226 of the 'Said Rule'.

It appears that the petitioner deposited certain amounts with the Excise Department, the details of which are as under :-

1. Rs. 1,50,00,000.00 on 29-6-1994.

2. Rs. 11,85,240 on 26-11-1993.

3. Rs. 12,64,022 on 26-11-1993.

3. Subsequently, the matter was adjudicated and being aggrieved by the order passed by the adjudicating authority, which confirmed the demand as raised in the show cause notices, the petitioner herein preferred appeals before the Central Excise and Gold (Control) Appellate Tribunal (for short, CEGAT, hereinafter) being Appeal Nos. 2002 to 2025/R/97/BOM which have been decided on 8-3-1999 [1999 (111) E.L.T. 223 (Tribunal)]. The appeals were allowed and the impugned orders passed by the adjudicating authority were set aside. The Tribunal directed that consequential relief be granted in accordance with law.

4. The amount which was deposited during the adjudication proceedings were not paid back to the petitioner despite repeated applications. Ultimately, a show cause notice came to be issue, inter alia, pointing out that as per rule 232B of the Rules, the duty was not paid 'under protest'. As the letter was not delivered to the proper officer, i.e. Assistant Collector of Central Excise, the amount paid under protest cannot be treated as "under protest". It is further pointed out that protest would be effective only after getting acknowledgment from the proper authority, and if the party fails to do so, the payment made by the party would be deemed to have been paid without any protest.

5. The second point raised in the Show Cause Notice was that the amount of Rs. 1,50,00,000.00 paid on 29-6-1994 vide letter dated 29-6-1994 though under protest, it was paid to the Collector instead of Assistant Collector, and it did not bear any date of acknowledgment. It was further indicated that in view of section 11B(1) of the Central Excise Rules, 1944, the duty amount claimed is time-barred. It was further pointed out that under the provisions of Section 11B of the Act, the incidence of duty of excise having been passed over to other persons, the refund is to be credited to the Consumer Welfare Fund. It was pointed out that no material has been placed to indicate that the incidence of duty has not been passed on to any other person. The petitioner was called upon to file a reply to the show cause notice within a period of 15 days.

6. To the said three show cause notices, replies were given indicating that the counsel is out of India and services of the counsel being not available, reply will be filed shortly. The petitioner thereafter filed this petition, inter alia, contending that the respondent No. 3 had no authority under the law to issue such notices, and instead of refunding the amount deposited by the petitioner, the Revenue has wrongly withheld the amount, dishonestly and without any bona fides.

7. On behalf of the petitioner it is further submitted that against the order made by the Tribunal, the respondents moved the Apex Court by preferring an appeal and stay application. However, the Apex Court by an order dated 3-11-1999 passed the following order :

"Delay condoned. No stay. Appeal is admitted".

8. It is submitted that even after this order passed by the Apex Court, despite the applications, the amount deposited has not been paid back to the petitioner but instead of that, after the stay being refused by the Apex Court, the Department has issued show cause notices.

9. Mr. Mehta, learned Counsel appearing for the Union of India submitted that in the instant case, the amount of duty has been paid and therefore, there is no question of refunding the same to the petitioner unless and until the respondents are satisfied that the burden is not passed on to the consumers by the assessee, the petitioner. It was submitted that except the amount of Rs. 1,50,00,000.00 other amounts were paid even before the show cause notices were issued. Therefore, the amount was paid towards duty and the question of refund does not arise. It was further submitted that for the refund of duty, the provisions contained in rule 233B will apply and as there is non-compliance of this Rule, there is no question of granting any refund of duty. Mr. Mehta further submitted that in view of this, once the petitioner has given a reply to the show cause notice, it must appear before the authority and it must satisfy the authority by producing necessary evidence as to why the refund claim should not be rejected, and even in case the claim is found to be admissible under Section 11B of the Excise Act, 1944, why the same should not be credited to the Consumer Welfare Fund. It is only after satisfying the authority that the amount could be refunded. He further submitted that in view of the provisions contained in sub-section 3 of Section 11B, the amount can be refunded only after following the procedure prescribed in sub-section 2 of section 11b. Mr. Mehta submitted that in view of clause (e) of proviso to sub-section 2 of section 11b if the manufacturer has not passed the incidence of duty to any other person, then only he would be entitled to get the amount of refund, and not otherwise.

10. Inview of what is stated hereinabove, Mr. K. S. Nanavati, learned Counsel appearing for the petitioner with Mr. Vakil submitted that the Respondent No. 3 has exceeded his powers and has issued show cause notices which are without jurisdiction. The question is whether the amount paid was "deposit" or "duty" and whether the said amount is required to be refunded or not. With a view to canvass the submission that the amount paid was "deposit", Mr. Nanavati submitted that under the Central Excise Act, there is a procedure for levy and collection of duty which is defined under Chapter II. He drew our attention to sub-section (1) of section 3 of the said Act, which reads as under :-

3(1). There shall be levied and collected in such manner as may be prescribed duties of excise on all excisable goods which are produced or manufactured in India as, and at the rates, set forth in the Schedule to the Central Excise Tariff Act, 1985;

11. Mr. Nanavati submitted that schedule to the Central Excise Tariff Act, 1985 prescribed the rates and it is not the case of the respondents that the assessee has not paid the excise at the rate set forth in the schedule of Central Excise Act. The duty was levied and collected in the manner as prescribed. The subject matter and the dispute as pointed out by the Tribunal was as under :

The question for consideration in this appeal is whether value of this NABB is required to enhance as has been ordered by the Commissioner on account of the addition of the following :

(a) Expenses incurred by M/s. Soft Drinks and Advertising Marketing Services Private Ltd. (SAMS for short).

(b) Amounts based on entries and worksheet found in the premises of the assessee, referred to as the rate difference.

(c) Amounts figuring in the debit notes issued by the assessee to the bottlers.

12. It is further pointed out by the Tribunal in paragraph 2 as under :-

"2. In the order impugned in these appeals, the commissioner has held these are required to be added to the assessable value and confirmed the duty consequent upon such addition. He also imposed penalty for evasion of duty on the companies and their Directors and other employees"

13. Thus, the real question before the respondents was, whether the value of the excisable product is required to be enhanced or is required to be accepted as already indicated by the assessee ?. If the value of the excisable product was not to be increased as suggested, there would be no question of payment of further duty for the goods already sold after collecting/paying the excise duty at the prevailing rate. If value of the goods already cleared before years was enhanced obviously the additional duty will have to be paid by the manufacturer of its own. There is no suggestion by the Revenue that the assessee collected excise duty at higher rate than the rate prevailing at the relevant time, and therefore no question of paying the same would arise. It is not the case that additional amount required to be paid subsequently was infact added in the invoice, collected from consumers and not paid to the Revenue. It is not the case that the petitioner paid the duty at a particular rate and later on Tribunal held that the rate which was applied was higher than applicable. It is also not the case that the Tribunal decided in favour of the petitioner as the duty was leviable at a rate lower than the rate at which it was paid. If the petitioner was claiming such difference, then the matter would stand on a different footing. If the petitioner has satisfied the Tribunal that the value of its product was correct and, therefore, he was not liable to pay any further amount, there is no question of considering whether clause (d) of proviso to sub-clause (2) of Section 11B of the Act would apply or not.

14. It is required to be noted that under the Central Excise Act, there is only one duly and that has been imposed on the manufacturer. The duty on the excisable goods has to be paid before the clearance of the goods. in the manner and mode laid down under the Act and the Rules. The Act does not impose any other duty. The excise Department is not concerned with what happens to the goods after the goods are cleared. Reading Section 3 of the Act, it becomes clear that the amount paid at that stage is the amount of duty and that amount of duty can be presumed to have been passed on to others.

15. It is not the case of the respondents that though the goods manufactured by the petitioner was excisable goods, petitioner had not prominently indicated the same in the invoice of sales and the amount of such duty did not form part of the price at which the goods were sold. Therefore, whatever excise duty was charged at the relevant time, the incidence of which had been passed on to other persons, is not being claimed. It is also not the case of the respondents that the duty was not paid as per the rates mentioned in the tariff at the time of clearance, but the case was that assessable value was not correctly shown and therefore proper excise duty was not paid. The value was required to be enhance according to the authority issuing notice and as a consequence, assessee was called upon to pay more than what was paid at the time of clearance. Now as there is no dispute so far as the proper amount of duty is concerned, we find no merits in the submissions made by learned counsel for the Revenue.

16. So far as Section 11B of the Act is concerned, learned counsel appearing for the respondent submitted that the procedure under sub-clause (2) is required to be followed. As indicated hereinabove, according to the petitioner, there is no question of refund of duty but the question is of refund of deposit. In this context, rule 233b of the rules will have to be considered. The said Rule reads as under :-

"233B (1) Where as assesses desires to pay duty under protest he shall deliver to the proper officer a letter to his effect and give grounds for payment of the duty under protest.

(2) On receipt of the said letter, the proper officer shall given an acknowledgment to it.

(3) The acknowledgment so given shall, subject to the provisions of sub-rule (4) be the proof that the assesses has paid the duty under protest from the day on which the letter of protest was delivered to the proper officer.

(4) An endorsement "Duty paid under protest" shall be made on all copies of the gate-pass, the Application for removal and Form RT12 or Form RT 13, as the case may be.

(5) In case where the remedy of an appeal or revision is not available to the assesses against an order or decision which necessitated him to deposit the duty under protest, he may, within three months of the date of delivery of the letter protest, give a detailed representation to the Assistant Commissioner of Central Excise.

(6) In cases where the remedy of an appeal or revision is available to the assesses against an order or decision which necessitated him to deposit the duty under protest, he may file an appeal or revision within the period specified for filing such appeal or revision, as the case may be.

(7) On service of the decision on the representation referred to in sub-rule (5) or of the appeal or revision referred to in sub-rule (6) the assesses shall have no right to deposit the duty under protest;

Provided that an assesses shall be allowed to deposit the duty under protest during the period available to him for filing an appeal or revision, as the case may be, and during the pendency of such appeal or revision, as the case may be.

(8) If any of the provisions of this rule has not been observed, it shall be deemed that the assesses has paid the duty without protest.

NOTE : A letter of protest or a representation under this rule shall not constitute a claim for refund."

17. Reading the aforesaid provision, it becomes clear that at the time of payment of duty as mentioned in the aforesaid Rule, if the assessee has any objection to the rates etc. then he has to make payment under protest to the appropriate officer. It is for that duty/refund of duty, the procedure as laid down under rule 233B is required to be followed. This rules will be applicable at the time of clearance of the goods and not at any time thereafter. At the time of payment of duty when the goods are being cleared the question of payment of duty with protest or without protest may arise. This provision cannot be applied in a case where disputed was subsequently raised that the duty paid by the assessee was less than due. Here the assessee was called upon to pay additional amount on the ground that the value of the product had been incorrectly stated and thereby cost/price had been reduced. Thus it was alleged that though the rate was rightly applied for calculating the duty, the Revenue had suffered as cost was artificially reduced and hence show cause notice was issued much after disposal of material in the market after collecting the excise duty at the applicable rate. Now, if the manufacturer is held liable to pay the duty, the manufacturer would be required to pay the amount which has not been recovered from the consumers and paid to the Revenue on 15th February, 2000.

18. Rule 232B makes it clear that when the assessee desired to pay duty under protest, he has to deliver to the proper officer a letter to this effect along with the grounds. In the instant case, it is not the case that at the time of clearance of goods any protest was made. Whatever duty was leviable, has been paid. In view of this, there is no question of applicability of Rule 232B of the rules because at the time of payment of duty, no duty was paid under protest. In the instant case, at the cost of repetition, we state that the case is of enhancing value of the material, for which the show cause notice was issued, on the basis which the amount was paid. Therefore, this would amount to 'deposit' and not 'duty'.

19. It is required to be noted that the amount was paid during the pendency of the proceedings much after the clearance of the goods in accordance with the procedure laid down in the Rules. The Rule is clearly procedural in nature and in the instant case, the occasion to obtain refund does not arise out the procedural provisions of the Rules. In the instant case, substantive right to get the refund arose in view of the order passed by the Tribunal. Under these circumstances, it is very clear that there is no question of following the procedure laid down under section 233b of the rules and, therefore, that would not disentitle the assessee from recovering the amount paid and recovered by the Department in contravention of law.

20. Learned Counsel for the Revenue submitted that in the instant case, if the assessee would not have paid the amount and if the order would have been paid the amount and if the order would have been adverse to him, then the assessee would have to file an appeal and during that appeal either the assessee might have deposited the amount or the Tribunal might have protected the assessee. If the assessee had deposited the amount and the appeal was allowed, then the assessee would be entitled to get the same.

21. The amount of duty at the time of clearance of the goods is to be understood as duty paid at the time of clearance of the goods on the basis of the invoices. It is not the case that more duty was charged from the consumer and less was paid to the Revenue. Under Section 12A of the Act, every person who is liable to pay duty of excise on any goods at time of clearance of the goods has to indicate the amount of duty, which forms part of the price at which such goods were to be sold in all the documents not only relating to the assessment but sales and invoices also. Thus, whatever duty amount was collected has been credited in the account of the Revenue. There is not whisper that breach of the aforesaid provision has been committed by the petition.

22. Learned Counsel Mr. Nanavati submitted that in the instant case, if the amount towards duty as claimed by the Revenue was not deposited and after adjudication proceedings appeal would have been preferred, then it would have been considered as 'pre-deposit'. Section 11B of the Act would not be made applicable to such deposits. In the instant case, this is not a payment of duty but is only a deposit which was made with a view to avoid interest if ultimately it is held that the petitioner is liable to pay the amount demanded. Such amount is to be refunded when the appeal is allowed with consequential reliefs. There is no question of unjust enrichment. In the case Suvidhe Ltd. v. Union of India reported in 1996 (82) E.L.T. 177 (Bom.), the Bombay High Court considered the aspect of pro-deposit and held that the amount of 'pre-deposit' for availing right of appeal is bound to be refunded when the appeal is allowed with consequential relief. Doctrine of unjust enrichment has no application to such deposit. In that case, the Court pointed out that the show cause notice issued by the Department for fore-feiture of amount is thoroughly dishonest and baseless. The Court passed an order of refund of the amount with 15% interest.

23. Mr. Nanavati, learned Counsel submitted that the aforesaid decision of the Bombay High Court has been confirmed by the Apex Court. SLP preferred against the order has been dismissed by the Apex Court and for that purpose, he drew our attention to 1997 (94) E.L.T. A159 wherein these facts are indicated.

24. Even considering the facts of the present case, it cannot be said that it is a case of unjust enrichment and, therefore, the amount which is deposited by the petitioner is required to be refunded when the order of the appellate authority is set aside. On what basis the Revenue contends that this is unjust enrichment has not been place before us. The Revenue could not point out as to the difference between the amount deposited during the appeal and amount deposited during the adjudication proceedings. As we have said earlier, the amount of duty paid under Section 3 of the Act is the duty and whatever is claimed subsequently can be said to be duty only after the order passed by the adjudicating authority is finally confirmed. Till then, it cannot be said to be amount of duty.

25. In view of the aforesaid facts, it is clear that the amount of duty shown in the bill is paid to the Revenue. Subsequent demand is on the ground of undervaluation, but the Department has miserably failed in establishing it. Therefore, it cannot be said that the assessee has recovered from its customers the amount subsequently deposited with the Revenue and thus enriched itself by collecting such amount from the customers. Therefore, in the instant case, the Revenue's contention that until the assessee establishes that it has not enriched itself by collecting duty from its customers it cannot claim refund, cannot be accepted.

26. In view of the aforesaid situation, we are of the view that the amount as deposited by the petitioner has to be taken as 'deposit' and the Revenue is required to refund the amount of deposit. It is directed that the Revenue shall, within a period of four weeks from today, refund the amount with interest will be calculated from the date of the order of CEGAT. However, if the amount is not paid within a period of four weeks, the Revenue shall have to pay interest at the rate of 18% per annum for the subsequent period.

27. This petition stands allowed accordingly. Rule made absolute accordingly. No order as to costs.